Firering Strategic Minerals: From explorer to producer. Watch the video here.
This is brilliant for Ukraine but alas POG still has only two working days to live.
Yep and there is no way to escape until its resolved, and telling GPB the company is doing well is actually an even bigger incentive for them to seize assets, its just like offering someone a plump and healthy chicken, instead of one that looks sick.
Yep and Poly doesn't have a bank calling in bank loans larger than the companies total value, in an attempt to trigger a default and seize all the assets, so if Poly goes up on a good RNS on Monday it will likely stay up and possibly go further.
I was really close to buying JRS but then I realised those banks won't be able to expand and return to Europe, so their damage is much more permanent than these commodity miners. I also expect the oil and gas price to fall after ceasefire, so the upside from the energy component of that portfolio isn't huge either (2x at most). Poly and Evraz though have an easier path to recovery to prewar valuations.
All of this is just smoke and mirrors until they clear up what's happening with GPB on Tuesday.
I don't mind if it does that to be honest, I will even buy at 2.6 p cos I'm 10% up from Poly, but they need to clear this mess up with GPB.
@Superbigmac you can probably buy at that price if the next update is negative but how will you profit afterwards when GPB seize everything for nothing?
Its just a dead cat bounce, I sold all of my POG at 2.4p the day they announced investors could get wiped and here we are at 2.2p, on the same day I also bought Poly at £2.30, which is now £2.60, and this represents a tangible 10% profit before dividend and this is better than the 10% loss I would have incurred if I just held POG. Its also quite likely POG still defaults by the 26th and GPB come here and seize everything, because that's how the law works even in noble western countries.
If AZ wanted to extend the supply agreement they would have done so weeks ago without pausing production, which is what happens with other ongoing supply agreements the company has. OXB should have been responsible and held onto their cash to help adapt to the post pandemic market but they have possibly overstretched with the acquisition of Homology. They can at the very least continue to survive in the short term with their Novartis and Boeringer supply agreements, but this is a risky position to be in.
They can't all sell in one go because there isn't enough volume and the price would be trading under a penny in seconds if they did, as a result of this they are all largely dependent on OTC trades to move large holdings and constantly remain trapped.
This is like a big game of corporate chess now and the latest demand from GPB for loan repayment by the 26th of April is another play at attempting to seize POG assets and it seems they have brought in UMMC as a partner to help them manage the logistics of this business with their expertise.
POG does that themselves with all these depressing investor warnings, they had months to plan contingencies and failed, now they are begging for buyers who will no doubt seek to take advantage and leave shareholders with nothing.
Reading this article I sense they deeply misunderstand the real factors at hand why Polymetal is a popular stock on the LSE, the truth is Polymetal is clearly undervalued and investor education drills in the mantra of buying the dip and trading without emotion, and these are the real driving force for Polymetal investors, rather than some political protest. If Polymetal also had some dubious connection with the Ukraine war it would have already found itself sanctioned, so that concern has slowly evaporated from investors, while the war has also shifted out of North Ukraine, correspondingly a noticeable increase in stock price has been made as investor confidence here returns over time. The upcoming investor meeting will also clarify if Polymetal is still turning a reasonable profit and that can embolden investors further.
In a nutshell yes before passing it over to GPB.
"POG RNS: In addition to the Regulations, the Company is aware of reports of proposed Russian legislation to make it a criminal offence for persons or entities in Russia to refuse to deal with counterparties on the grounds of the Regulations. If such legislation is enacted, the Board may not be able to ensure that its subsidiaries will comply with the Regulations in Russia".
Nobody is discussing this proposed legislation from the Russian government but its actually very significant, as
these regulations will make it a criminal offence for POG to avoid complying with the GBP agreement, so the Russian government could be creating a legal mechanism for POG assets to be seized by GBP and that arrangement is more profitable to them than a simple 200 million pound loan repayment. A quick glance at history will also illuminate a number of corporate dealings that benefit oligarchs close to Putin, including the knockdown sale of Sibneft to Abramovic and its no surprise that the owners of GBP and possible future owners of POG are oligarchs with known close relations to Putin.
So the fire sale is a possible race against the clock to avoid being devoured by GBP and it is not clear if a reasonable return to shareholders can be negotiated before this fate.
It's a shame this opportunity has been compromised by the last round of sanctions and this is why it is important to have a diversified portfolio, as you have to expect some casualties during this period. There is also no reason to continue holding POG at present when other rivals with the same war time discount are not struggling to this extent, including Poly. Those companies that continue to generate income during this time including Evraz and Poly will weather this storm and recover accordingly.